Audit exposes loopholes at Nipam

An audit conducted at the Namibia Institute of Public Administration and Management (Nipam) by Ernst & Young has unearthed how its axed boss, Professor Joseph Diescho, allegedly abused benefits such as cellphone and car allowances.

The audit, which was conducted to review and evaluate the accuracy of all salary amounts accrued or paid to Diescho, including fringe benefits, also rapped Nipam over the knuckles for poor control measures.
The audit report was released to the Nipam governing council in October.

It surfaced just days after it was announced that Nipam and Diescho have parted ways after months of acrimonious relations.

The Nipam governing council said Diescho’s employment contract was terminated because of alleged insubordination, material breach of the employment contract, competition with the employer and non-compliance with resolutions of the Nipam governing council.

New Era understands that Diescho was sent packing mainly due to the findings of the audit, which suggested that he often abused his cellphone and fuel allowances, running into thousands of dollars.

Recent media reports centered around Diescho’s municipal and rental bills, but the audit report went further into how he often surpassed his monthly airtime allowance of N$1 000 and N$3 000 for fuel.

It was required that if Diescho needed additional fuel than the prescribed N$3 000 per month, he must seek the governing council’s authorisation.

The report says that between February 2014 and August 2015, Diescho accrued N$23 000 more than the allowed bill without council’s approval.“Management should engage with both the employee as well as the governing council to determine whether the historic costs will be authorised or will be recovered from the employee,” reads the report.
As part of his benefits, Diescho was authorised by council to buy an entry level Mercedes Benz ML class and it was required that such vehicle be under a service plan.

The audit found that Diescho, with the approval of the deputy director, acquired the “highest level of vehicle within the Mercedes Benz ML class” which was under no maintenance plan.

Over N$102 000 was incurred for the repair and maintenance of the said vehicle between March 2014 and July 2015, but auditors say they could not work out how much would have been saved if the vehicle had been under a maintenance plan.

“In terms of the obligation created in the employment contract and as approved by the governing council on 11 July 2013, Nipam acquired the vehicle at a level higher than that benchmarked and has as such incurred additional expenses,” the report further reads.

The report, however, states that the authorisation for acquiring the car was done within the confines of Nipam’s procurement practices and it could therefore not be argued that Diescho acted in bad faith.
On the cellphone allowance, the report states that between July 2013 and August 2015 Diescho exceeded his cellphone allowance of N$1 000 per month by a total of N$18 315.

It found that Nipam could not recover this money by deducting it from his salary because the institution does not have formal policies and procedures pertaining to the allocation and limitation of cellphone accounts.
The audit recommended that such policies be enacted and provide guidelines on limitations, how exceeding limitations will be dealt with and reconciliation of pre-payments to monthly limitations.

Last week, Nipam announced it would pay a N$3.6 million severance package to Diescho. It is understood that the institute plans to deduct from this amount all expenses that Diescho might have irregularly benefited from, including municipal rates and rent for the company house he lived in.